captioning sponsored by macneil/lehrer productions >> woodruff: anti-american clashes erupted around the muslim world for a fourth day with protests outside u.s. africa, and asia today. east, good evening. i'm judy woodruff. >> brown: and i'm jeffrey brown. on the newshour tonight, we get the latest on the demonstrations, and the return of the remains of four americans illed in libya. >> woodruff: then, did the big bank bailouts here in the u.s. work? ray suarez gets two views on this fourth anniversary of the

fall of lehman brothers. >> brown: david brooks and ruth marcus analyze the week's news. >> woodruff: and hari sreenivasan talks with journalist sasha issenberg about his new book exploring how the campaigns are mining data to boost turnout in november. >> whether you are likely to default on your loan or pay off your bill on time or run up $500 on your credit card in a given month, on trying to predict who you are going vote in november, who are you likely to vote for, what issues do you care about. >> woodruff: that's all ahead on tonight's newshour. major funding for the pbs newshour has been provided by:

>> bnsf and from carnegie foundation >> and with the ongoing support of these institutions and foundations. and... >> this program was made possible by the corporation for public broadcasting. and by contributions to your pbs station from viewers like you. thank you. >> brown: protesters poured into streets around the world today, outraged by a film made in california that mocks islam and the prophet muhammad. they vented their fury in at least 20 countries, and violence

broke out in a number of cities, especially in the middle east and africa. at least four people were killed. u.s. embassies were the focus of much of the wrath, but appeared to escape serious damage. rage followed the reflection of friday midday prayers as protests over the antitislamic film targeted american installations in city after city. sp tunisia, where the arab riin uisprgseaegisan nrly two years ago,ros ry cwd moved on the u.s. embassy, setting fires and battling police. two protesters were killed. a similar assault was mounted on the american embassy in sudan. police drove back the crowds with gunshots and tear gas. the rioters in khartoum also assaulted the german embassy, leaping over the compound walls and holding aloft a banner proclaiming the islamic faith. that sparked outrage in berlin, from german foreign minister guido westerwelle. >> i demand from the sudanese

authorities that the safety of the german embassy will be guaranteed immediately. i condemn this anti-islamic hate video. but still, this cannot be a justification for the outbreak of violence. >> brown: u.s. marines were dispatched to the capital of yemen, where the american embassy was assaulted yesterday and where clashes continued today. in tripoli, lebanon, american commercial symbols were ransacked and torched-- a kentucky fried chicken and a hardee's. one person was killed there. at the same time, pope benedict xvi arrived in beirut for a long-planned visit. >> ( translated ): if the situation becomes more complicated, it is even more necessary to give this sign of brotherhood, of encouragement and solidarity. so the essence of my trip is to invite dialogue and peace against the violence. let's try together to find the solution to the problem.

>> brown: in east jerusalem-- a city sacred to christians, jews and muslims-- palestinian protesters filed out of the old city, and then clashed with mounted israeli police. congregants in gaza heard an outraged appeal from ismail haniyeh, leader of the militant group hamas that now governs there. >> ( translated ): we repeat our demands and raise our voice to the u.s. administration to apologize to the arab and islamic nation for this offensive film, and to prosecute those terrorists and criminals. >> brown: and thousands turned out in egypt for friday prayers in cairo's tahrir square for a mostly peaceful demonstration. >> ( translated ): i came to the square not to attack the american embassy or america itself. i am against those who produced, financed and acted in the movie. i demand that they get publicly executed. they didn't just insult prophet muhammad, they insulted all muslims. >> brown: but just a few blocks away, near the american embassy, police and youths continued the skirmishing that's been going on for days. the egyptian president, mohammed morsi, prayed at noontime in

rome as he continued a mission through europe, and he addressed the faithful, counseling restraint. >> ( translated ): islam is peaceful and bigger than those who tried to hurt it, because it takes care of all the other religions. >> brown: earlier, after a meeting with the italian president, morsi reiterated his statement from yesterday that decried the film while promising to protect foreign diplomats. >> ( translated ): in egypt, we have clearly declared that we reject and condemn the killing of innocent people and the attacks at embassies and consulates. our duty is to defend diplomatic corps, tourists, and all foreign people who are guests in the country. >> brown: morsi had initially avoided that protective pledge after the u.s. embassy in cairo was attacked tuesday. he received what multiple reports now say was a blunt phone call from president obama wednesday night. according to those accounts, chastened egyptian officials then scrambled to defuse the volatile situation. today, reuters reported that

u.s. intelligence officials had concerns after clips of the offending movie, "the innocence of muslims," were first broadcast saturday in egypt. but white house officials said there was no advance warning of what was coming. meanwhile, in libya, the president of the national assembly visited the charred ruins of the u.s. consulate in benghazi, where ambassador chris stevens and three colleagues died tuesday. >> ( translated ): i want to offer my thanks to ambassador stevens. i want to thank him and to thank the american people who gave birth to such special diplomats. >> brown: the bodies of the four slain americans were repatriated today outside washington at joint base andrews. >> let light perpetual shine on chris, sean, glen and tyrone. >> brown: ambassador stevens and state department officer sean smith were brought home with two former navy seals who'd been

detailed to protect stevens, tyrone woods and glen doherty. president obama paid tribute to them, joined by secretary of state clinton. >> they didn't simply embrace the american ideal, they lived it, they embodied it. the courage, the hope and, yes, the idealism-- that fundamental american belief that we can leave this world a little better than before. that's who they were and that's who we are. if we want to truly honor their memory, that's who we must always be. >> brown: the president again pledged that the killers would be brought to justice, and that the diplomatic work for which the four americans gave their lives would be made safer for those who continue it. a short time ago, i spoke to nancy youssef of mcclatchy newspapers. she's based in cairo and has been covering the protests in

egypt and the wider region. nancy,y,come back. there were conflicting reports about whether the muslim brotherhood canceled calls for a larger protest today or merely called for it to be more peaceful. what do you know? what did you see today? >> well, about an hour before protests were supposed to start here, remember friday's the traditional day for protesting that happens after prayer. the muslim brotherhood put out a tweet and a facebook message that said let's not have the kind of protest that we were calling for. which would have meant hundreds of thousands of people throughout egypt. but instead called for a peaceful demonstration. so it was a bit vague in terms of what they wer tee asking their members to do. but i can tell you on the streets here in cairo it was clear that the muslim brotherhood following wasn't a part of today's demonstration. it was made up mostly of young men. >> brown: and do you know what was behind that call from the brotherhood?

why they seemed to want to tamp things down a bit? >> yeah. we started to see this actually after tueueay when the initial protests began. and at that time many islamists groups were calling for their followers to come out and condemn this movie.e. i think a lot of them were taken by surprise at the scale and the violence that was behind them. and i think there was an understanding that reacting violently to-- to the movie really hurt not only the message but also split within their base. i talked to a number of egyptians here who said that one yong shouldn't be met by another. >> brown: so in cairo and in some of the other cities in the region where you have been able to talk to people, the protestors that did get out there, how organized did they seem to be? and the response from the police and government, how strong was that? >> throughout the region there seemed to be a

consistent response from the police using tear gas and in some cases in tunesia, for example, live rounds. and that in tunesia they were able to eventually thwart back the attacks even after protestors had crossed the outer perimetre. in egypt it was less effective. they without launch tear gas and would send crowds scurrying but they always came back. it actually lead to sort of more chaos in the streets because the young men would set trash and other things on fire to try to fend off the fumes. so in yemen we saw a bit of that today as well it seemed that the-- the tear gas approach, if you will, worked a little bit but not enough to really quell the crowd. >> brown: and in egypt we saw how we reported on the talk that president obama had with president morsi, apparently taking a hard line about his initial lack of response on the attacks on the embassy.

where do relations stand now? are they strained as far as you can tell? >> it's very clear that there is a strain because at the end of the day, i think there's a real lack of trust among americans that the egyptians are committed to, securing their embassy. remember when the attack happened on tuesday, when they were able to breach the wall the embassyy was guarded primarily by egyptian guards. and they essentially disappeared allowing-- allowing egyptians to cross over, scale that wall, put a ladder against the flag pole, climb up it, grab the american flag and bring it over the wall to tear it up and burn. so and burn it. so there is a feeling here that there is a break in relations. i think the comment that president obama made to telemundo that egypt was neither an ally or an enemy further strained those relations even as the white

house tried to push it back yesterday. the pushback didn't arrive in cairo. the original message did. >> brown: nancy youssef in cairo, thanks so much. >> sure. >> brown: for a perspective from a different part of the middle east, i spoke with rob malley in tripoli, libya. he's former director for near east affairs at the national security council in the clinton administration. he's now at the international crisis group. >> brown: rob malley, so what is the atmosphere there these few days afterhe attack on the embassy? >> well, you know n some ways obviously the most tragic and dramatic event occurred in benghazi and libya. but since then the atmosphere might have been one of the least radical, least violent in the region, partly because there is a sense of gratitude towards the united states because of the role it played in toppling colonel qaddafi, but also because coy say with every conversation i have had with

every libyan here in the last three or four days a sense of shock, dismay and embarrassment over what happened at the killing of the u.s. em was door. and i think that has really been a wake-up call for many here who, in fact, want to take action now against these militias and armed groups, whether they are able to do it or not is another question. >> brown: are you picking up any more about who was responsible, who's being looked at, who is being discussed over there? >> i mean it is early. most people assume that it's radical jihadist group which is known here and which now some of the militias are going after. but there is really a broader problem h h the problem is that since the fall of qaddafi the authorities are relying not on their own security forces, because they don't have any. they have subcontracted security to mililias and armed groups because they need someone to step in. but those very forces are the ones that are fueling the instability and the violence. so in some ways it is a vicious circle, until the state can have its own police, its own security

forces which are loyal only to the state it really won't be able to have a handle on the security situation and you're going to see them relying on these other groups and with the proliferation that remains in this country it will remain volatile for some time. >> what about the security of the u.s. presence there and throughout the region. here i'm tapping into your experience throughout the region and in washington. based on that, what is going on, do you think now, in terms of finding better ways to protect our people and embassies in the region. >> i think there is a both broader theme here which people have to-- we all have to sort of come to terms with, which is that the arab uprisings have brought many benefits to many people but the same time they have left behind an economic, a security and a political vacuum. an economic vacuum because in many of these countries you have young alienated, frustrated unemployed people who don't have jobs,

particularly that is the case in egypt and tunesia. a security vacuum because in a number of these countries the security forces have either been completely disbanded, that's been the case in libya, or are now feeling that they were the targets of the uprisingsnd they are not about to play a role in trying to help the new authorities restore order. and that's the case in egypt and in tunesia. >> brown: let me ask you briefly, rob, is there anything, in that context when you look at these demonstrations in the region, is there anything anyone can do now to calm the situation? >> well, inhe very short term i think those who have to calm the situation are the authorities on the ground. and in particular, again, two of the cases where things are most volatile in egypt and in tunesia, you have islamist governments who are dealing with islamist-- radical islamist protestors that creates some dilemma because they don't want to be seen as betraying the very religious values

upon which the oddology is based. but they also don't want to see disorder because they want to stand for security and safety in their country. but they're the ones. they needd religious message, political message to calm the situation down and to really actually try to restore order. >> brown: rob malley in triply, thanks so much. >> woodruff: still to come on the newshour: the bank bailouts four years after the lehman bankruptcy; brooks and marcus; and the science behind campaign victories. but first, the other news of the day. here's kwame holman >> holman: the president's republican opponents demanded a tougher line today on protecting american interests. in new york, mitt romney said egypt must protect foreign diplomats, or risk forfeiting $1.3 billion a year in u.s. aid. and in washington, romney's running mate, paul ryan, charged president obama had emboldened extremists by showing weakness.

>> only by the competent exercise of american influence are evil and violence overcome. that is how we keep problem as broad from becoming crises. that is what keeps the peace. and that is what we will have in a romneyey ryan administration. >> holman: romney and ryan also accused the president of dismissing israel's concerns about iran's nuclear program. ryan said it amounts to "indifference bordering on contempt." negotiators in the week-old teachers strike in chicago now say they've achieved a framework for a deal. the school district and the teachers union will spend the weekend working out details, and the union will vote on sunday. that means some 350,000 students could return to school monday. neither side would specify what they've worked out on the conteteious issues of pay and teacher evaluations. in afghanistan, a bus and truck collided today, killin astt lea .51 leople it happened in the east, in ghazni province, on a highway linking the capital, kabul, with kandahar. a local official said the cause

of the collision was under investigation, but he did not rule out that it was triggered by an attack. the russian parliament today expelled a lawmaker who had turned against president vladimir putin. it was a new signal that a crackdown on dissent is intensifying. gennady gudkov waved farewell to members of the state duma after he was voted out. last winter, , helped organize a series of street protests against putin's return to power. gudkov said today the vote was a sham, along with the entire russian government. >> there is no longer a political system there is repression which fight against the opposition which shuts up the critics. it means that rususa is to the going in the right direction. >> holman: gudkov is a former kgb officer, like putin. he once had supported the main kremlin party in parliament. his ouster came a day before a major opposition rally in moscow. in u.s. economic news, auto sales and higher gas prices

drove retail sales numbers up last month. but industrial production fell more than 1%, the most in more than three years. despite that news, wall street scored new gains to finish out the week. the dow jones industrial average added 53 points to close at 13,593. the nasdaq rose 28 points to close just under 3,184. for the week, the dow gained more than 2%; the nasdaq was up 1.5%. a white house report formally warned today that the government faces $110 billion in across- the-board spending cuts come 2013. the cuts were designed to happen automatically unless congress adopts a sweeping deficit reduction package. social security, medicare, federal pensions, and veterans benefits would be exempt. the report said everything else, from the military to border enforcement to student loans, would suffer. those are some of the day's major stories. now, back to judy. >> woodruff: we turn to the impact of government bailouts here in the u.s. and questions

that continue to surround those decisions. it was september 15, 2008, when the investment bank lehman brothers filed for bankruptcy protection. ray suarez looks at what it set in motion and where things stand now. >> suarez: lehman brothers' collapse sent employees packing and the stock market plummeting. the bush administration had decided it would not rescue lehman. the treasury department had taken over mortgage giants fannie mae and freddie mac that same month, and helped save bear stearns earlier that year. treasury secretary henry paulson told reporters he was drawing a line in the sand. >> i never once considered that it was appropriate to put taxpayer money on the line in resolving lehman brothers. >> suarez: the decision helped trigger a credit and liquidity crisis, fueled by deep doubts about the health of financial institutions. weeks later, congress and president bush passed the

$700 billion troubled asset relief program, or "tarp." through tarp, the government disbursed money to hundreds of banks, and propped up firms like citigroup and bank of america. money also went to general motors and chrysler. tarp also provided new help to insurer american international group. a.i.g. was exposed to risky securities and provided insurance on credit swaps around the world. if it went down, the fear was other firms would follow. in october 2008, i asked edward liddy, who was the newest head of a.i.g., whether the lifeline would save the company. do you think that's going to be enough, though, the $120 or so billion, or might you need more? >> you know, i think so and i sure hope so, ray. it's very much a function of two things-- one, our ability to stop the bleeding that we have in the financial products areas, and we've made good progress in that. but it's also what happens to the capital markets. >> suarez: the final tally for a.i.g. would reach $182 billion

as the government became majority shareholder. this week, the treasury department said it has recovered all of that money, plus a profit, as it reduced its stake in the company to 16%. white house press secretary jay carney. >> we have been committed to exiting those investments as quickly as practicable, but always with a mind to taxpayer interests. it's safe to say that the president is pleased with the progress being made as we wind down these investments and recover taxpayer money. >> suarez: in total, the government disbursed $417 billion through tarp. while critics question the official accounting, the obama administration says $366 billion, or 88% of the total, has been recovered. republican presidential nominee mitt romney has said he supported the rescue of financial institutions.

but the former governor has criticized the auto bailouts, as he did recently in this tv ad that aired in ohio. >> in 2009, under the obama administration's bailout of general motors, ohio dealerships were forced to close. >> it was like the dream that we worked for, that we worked so hard for, was gone. >> i'm mitt romney and i approve this message >> suarez: as for lehman brothers, four years later, it is still selling off assets to pay back creditors. we get two views about the rescues and the state of the financial system. michael barr worked on many of these bailouts when he was assistant secretary of the treasury in 2009 and 2010. he's a professor at the university of michigan school of law. and dennis kelleher is the president of better markets, a non-profit organization pushing for tougher financial regulation and transparency. >> the u.s. government took big holdings in a lot of companies in that brief era but aig was arguably the poster child, how does the idea look in retrospect now

that it's unwinding and selling back the stock? >> i think the government took the right steps that were necessary to stabilize the financial system. not just the investment in aig and the trouble add set relief program but also the effort at the federal reserve to intervene to stabilize the economy, the federal deposit insurance corporation stepped in with guarantees in the banking system, the treasury department stepped if with guarantees in the money market mutual fund system. none of these were pretty things. all of them were politically unpopular. but i think that when you look at it if he end of the day we had a situation in which the economy was falling off a cliff and the government stepped in and took the steps necessary to make sure that the financial system didn't crash, that the economy could recover, that the automobile sector could recover, and i think without those steps our country would have fallen into the abyss. it would have been a horblt, horrible situation for all

of us. and i think now when you look at it the taxpayers being paid back, we've got a new, strong, financial regulation in place in the dodd frank act and the economy is beginning to recover. i think its with a necessary and just thing to do under the circumstances. and it is working. >> suarez: dennis kelleher, is it fair to say that you don't quibble so much with the what but the how? >> right, i mean i think that nobody really ostensibly debates whether or not the financial system had to be saved. we had to do everything we could to avoid a second great depression. i don't think there is any question on a bipartisan basis credit deserves to be spread far and wide. secretary paulson and president bush, president obama and his team and michael barr in particular worked very hard to make that happen. the real debate is over the conditions under which the bailouts were done. and then importantly, the incentives that theyreated and the implications of those. so it's true, it's good news

that aig did not collapse and bring down the entire financial system along with goldman, merrill lynch and a bunch of the others. but when you give that many, that muchchmoney and you bail them out with virtually no strings at all, you have rewarded egregiously bad behavior. and when you rerad really bad behavior you usually get more of it. so it's true, aig has now, depending on, if you don't quibble with the accounting, and some people do, but even if you accept the accounting, getting all the money back is goodment getting more money back than you put in is good. there are two key points. one is, that doesn't mean you made a profit. frankly the reality is it is on a risk adjusted basis and the american people were at grave risk but secondly you look aig is back in business. they are still not designated systemically significant. they are still engaging in a lot of the activities they used to, as are the rest of wall street. so the potential for the next crisis and the implications of that are still quite grave. >> suarez: how about that,

professor barr, can they just get in the same kind of trouble and come back to the federal government, in other words, the taxpayer? >> no, they can't any more. the reason that the president came in and just as we are dealing with bringing our economy back and reestablishing financial stability we have to be equally vigilant about creating a system for the future that makes the financial system more resilientnt that protects taxpayers, that helps the economy. and that's what the president stood for, worked on and fought to enact in the wall street reform act. we have a new consumer financial protection bureau to police against abusive practices. we have new authority for the government to wind down a firm like lehman brothers or aig if they manage themselves into trouble in the future without harming the taxpayer, protecting the economy. and we have a new set of rules in the game on derivatives to police that market and bring it into daylight. new sets of oversight for firms like lehman brothers and i-- aig that weren't

subject to the capital requirements that they should have been. and we have new capital rules being put in place globally that are much, much tougher than before, there will be biggercushons in the system. so in my judgement the financial system going forward is more resilient, or taxpayers are more protected. our economy is more protected. and we have a system that is designed to get at directly the problems that lead to the last financial crisis, a laxity in-- a leverage of opacity in the system. so i think we're in a very, very different place and it is because of the president's leadership. >> does that list of safeguards not qualify as protection from the kind of thing you were talking about? >> well, if they were in place they would. now the problem is that the wall street primarily in the biggest too big to fail banks are even bigger now and pose even greater risks. and the wall street reform act that he's referring to has got all the tools that we believe, and my organization better markets are in the trenches every day fighting, to implement

dodd frank and have very strong financial rules. but we are up against an army of lobbyists and lawyers that wall street and all these banks that were saved are deploying to kill or gut financial reform. secretary geithner and the-- the regulation agencies have been doing the best they can in some respects. but in other respects they have not. you can't expect the onslaught of unlimited resources that they have thrown at these agencies. we have moral hazard higher than it has ever been. we don't have an implicit government guarantee these activities. we have an explicit government guarantee. everybody knows today that a too big to fail firm will not be allowed to fail. that the american taxpayers will be put on the line to save them again. there may be a time in the future when the regulations from dodd frank are in place and will get applied and they may work. but it's still a massive struggle to make that happen in light of the fight that wall street is putting up.

>> suarez: professor barr how do you refly-- reply directly to that charge, if one of these firms and since banks have been allowed to merge in the last several years and become even larger, that if they go down, they are so intertwined with the rest of the system, they'll bring a the lo of wreckage down with them and there is nothing to stop it? >> well, the dodd frank act sets if place a framework for that, there are rules you can put in place for regulation authority, the technical term for the ability to woind down these firms. so if a firm got itself into trouble today, there is the authority to bring that firm into resolution, to wipe out the shareholders, to haircut the creditors, to fire the managers. it's just a fundamentally different set of rules that were in place before the financial crisis. so i do think the tools are there. now i agree with your guest that there is he more-- enormous lobbying pressure against the federal agencies right now trying to slow down or stymie financial reform. and those need to be fought back. there is enormous pressure in the congress.

they are republicans in the congress in particular who have is out the enforcement agencies responsiblblfor overseeing the derivative markets. there is a candidate for president who is argued that we should repeal the dodd frank act. so i do think there ask enormous rising that we could go back to the way that we were now if we don't stick with the path of reform. so it in incumbent, i think n this election and in the course of the regulatory environment, for every american to pay attention to the risk that we slip back to the way things were before. it was enormously costly to the country. it cost millions of americans their jobs. it shuttered american businesses. it really crushed the economy and we just can't afford it as a country to go back to that. >> well, the federal government still owns major positions in a lot of firms. we're not done yet so we will continue this conversation. gentlemen, thanks. >> thank you. >> thank you. online, we have a reader's guide to the bailout, featuring economics correspondent paul solman's reporting on the subject from the outs in 20le08.

you can find that on his "making sense" page. >> woodruff: and to the analysis of brooks and marcus. that's "new york times" columnist david brooks and "washington post" columnist ruth marcus, filling in for mark shields. welcome to o u both. before we start, let me share some new poll numbers out in the sdat 08w feys:w among likely voters across the country, cban nd "theew york times" finds the prwiid"tt enth % er49ovrot r 'sno geymn 46%;ey and fox news finds the president with 48% to romney's 43%. separately, in three key bateground states, an n/"stwbl alreet journal"/marist poll finds mr. obama ahead in ohio, and by an identical 49% to 44% in both florida and virginia.

so david, recognizing that these polls are just a snapshot, the elections weeks away wa, dow make of that? >> i think romney's concession speeee should be this evening, at some point. no, he's behind. if you take the average of all the national polls, he's probably behind by about 3.5, 3.of. the nba "the wall street journal" swing state polls shouou be more troubling to him. s is an excellent poll, a poll widely respected by the professionals in the field. and it shows him behind in all three states that he really needs to win. and if you look at all t t swing states, whatever it s however many you count, he is pretty much behind in all of them, usually by a much smaller margin. and to me what is most interesting about the poll movement in the last week is that romney is going down. and so the president is up a little but the president had a bounce and his bounce is pretty much over. but romney's going down. and so and if you look at where the movement happened, bill clinton was an important turning point and then maybe this week, it's hard to believe a week will help him but there is clearly a sense, certainly among republican circles that romney is behind.

>> woodruff: how do you feel. >> kind of the same. romney's pollster put out a statement early in the week saying that nobody should pay, get too flustered by these polls, they kind of reflected a sugar high after the democratic convention. i think it's looking more like one of those protein shakes that can keep you going for a while. i think david's totally right. the polls that should make the governor and his team most nervous are those polls from the three most important battleground states. because if you play around with those really fun interactive electoral college maps you cannot get to 270 electoral votes for governor romney without at least two of those states. and you can get there for president obama without them. >> woodruff: how do you account for this, though, what is the behind this? >> a bunch of -- it be a bunch of things. it is quandt erred convention of president romney. what do we remember, clint east wood, a well orchestrated convention from president obama wa, do we remember, the explain never chief president clinton

whose poll numbers are through the roof. dismantling an unpacking and rebutting every republican argument against the incumbent president and vouching for him. then you had some bad jobs numbers, they didn't seem to trouble the president. mitt romney first got pummeled with his fill in the blanks, details to follow economic policy. so i think we're going to hear more about that, especially in debates. and then i think he has, you were very kind to him about this week. i think he had quite a disastrous week, other than that things are going great. >> independent voters who voted for obama in o 8ee who drifted away and now faced with the alternatives they see today they are drifting back to obama. >> and more than that it's the movement. but there aren't a lot of folks left to move. one of the things that is striking when you look at these polls in the internals of these polls, very, very few people are undecided and seen fewer say they are

asked in any way to change their votes. what we heard from the romney campaign was yes, but there is more voters up for grabs than these polls indicate. the polls are not indicating that conditions with i say that is a huge-- over the past several decades but especially over the last three or four years. >> we have seen dealignment. we have seen people drifting away. i don't like either party, rise in independence so, that would lead you to think that when this election came around there would be a bunch of people in the middle swinging around but that is not true. they were stuck to the polls just as tightly as ever and seeing so little movement. >> why do you think that is. >> is it just too early to know. >> it is never too early to know for me. >> i am certain. >> good that is why we want your vote here. >> so my theory is that they ran a very traditional republican versus -- versus a traditional-- if you ran orthodox campaign, they put if line secondly the consultantses are good at microtargeting members of their coalition. they are really bad at

targeting the other side coalition so they are very good at building their coherent g gup. they are not so great at scrambling it all up. >> you mentioned the events of the last week. the eruptions in the muslim world and you have the governor romney quick out of the gate to make a statement. how do you size up how the candidates handled that from a political perspective? >> well from a political perspective, i would not give the president absolutely 100% remarks. there were some issues with the handles of the tweet from the embassy and his remarks about whether egypt was an ally that needed to be cleaned up. but by comparison if you are grading on a curve, he's getting a solid a and i am just flunking mitt romney, i'm in back to school mode so i'm giving grades these days. i know that the newshour is a civil place but i'm going to use an uncivil ward, but it is an uncivil word that mitt romney used by the president and the obama administration. i thought his comments were

really disgraceful. he mischaracterized what was said. >> an attack on the embassy and the consullate being to apologize for america rather than toto condemn attack and i thought his tuesday night comments were amateurish and way too quick. his wednesday morning doubling down was just unconscionable. >> other than that, i really like what he did. >> too strong a word. >> flying off the handle here. >> that's usual. >> i wouldn't go that far. i thought they were not good. how about that. not good. and i would say that for a couple reasons, the first news out of any international cries sis always. the first news is always kind of misleading, and i think in experienced hands would have waited beat rather than have that first romney thing. second, when bad things are happening abroad, the american people want to see stability. >> and they rally around the command never chief. >> they do. you don't know who is dying

or what is happening, just show some stability. when the helicopters went down under jimmy carter ronana reagan said i'm to the going to use this politicallyment that was the right instinct. third and this is deeply revealing of romney, he is just not an ideaological person so, what principles is he standing for in this fight, the principles that should not apologize that is not a principles am it is a managed tactct so trying to be an aggressive ideaological person while not really being an ideaological person, he has an ideaological fit over a management thing. about apologizing that has been a major part of the critique of romney, of the obama administration. >> sometimes awe poll gize, sometimes you don't. if you have a theory. >> but he never apologize, that is the problem. >> that's true too. >> i'm flying off the handle again. >> calm down, ruth. >> say you have a theory of as george bush z it was based on a theory of human nature. that people hunger forward freedom. it was based on a theory of history that the middle east

is becoming democratic so you orient your policies around that theory. top tell the existing order. that is a political theory. don't apologize t depends on the circumstances whether that, you are using apologies or not to depending what you do. can i say one quick thing now that i have bashed governor romney. i don't think this is going to matter that much in part because so many people have made up their minds. but also this ist an election that is going to be decided on foreign policy. >> you don't think so. >> no, this san election that going to be decided on people's assessment of the state of economy, the state of their well-being, and on their assessment of the characters of these two men. to the extent that this is a character question, maybe, i don't think it will make anybody like him more but while i am very o februaried by it as you can tell, you i don't think it is disastrous. and just one really interesting number from the polls, about people's a zms of the state of the world, 30% of people in the gallop

poll this week said they were satisfied with the direction the country was going in. that might sound pathetic, 30%. buttt's up from 11% a year ago. and that tells you something about where it is going. >> when george w. bush was re-elected in '04 it was about 32% it wasust much higher. that was a close race where the climate was against imhad. the climate is against the status quo. >> dow agree that foreign policy is to the going to be a big factor. you have as just reported in 20 countries protest against the united states. we were just reading reuters news. reporting u.s. sending marines. >> we'll s s. my rule is you can never escape the middle east. the middle east will always come back and something will happen there and we will focus our attention. but i still basically agree with ruth, unless things run out of control in part because despite the huffing and puffing there is really not a lot of partisan disagreement about most foreign policy issues. >> speak of the economy, the federal reserve announced yesterday this lightsest move to put money into the

economy to try to get it moving, to try to get more hiring and more investing. ruth, what dow make of this, does it have an effect on the election? what about, i mean what its its overall affect on the economy s it going to work? >> well, if it works and i think that the theory is sound t will work eventually but slowly, so i don't think it will have an effect on the election. we won't probably see the impact of this for six months or so. it reflects two things, i think from chairman bernanke. his lack of confidence and both of them might be justified. one is his lack of confidence in congress because he sees congress not stepping up to the plate to do the fiscal acts that are necessary to get this really lagging economy moving. and a lack of confidence in the economy. and so this was really in some sense his boldest move yet. because he didn't put a time limit on it. he said we'll be there into the unemployment rate gets to a more appropriate rate. that's probably, we're not

going see it at 7% according to the fed's own views until sometime in the middle of 2015. what did i say, unemployment rate, yes. >> how do you read this. >> yeah, well i-- i think it also reflects a lack of seeing any inflation-- inflation pressures in sight. whether that is true or not, food prices have gone up, gasoline price, other prices have gone up but clearly he is just stepping on the gas. i have been less impressed that we had qe and qe 2, now they are calling this qe forever. and so you know, i guess if the other qes had worked a little better i would be more impressed with this e. but nonetheless i do believe in general, i'm not huge a believer that fiscal policy has a big impact on the economy in the short term or i'm nervous about that but monetary policy surely does. and so if the floodgates are opened on monetary policy, i think that's bound to have some sort of effect. and it may take long as ruth says but i do think politically, the effects psychologically begins today organ actually at the market yesterday. which was you know

skyrocketing. and so i do think psychologically that are most powerful stimulative tool is just wide open. that's got to be, effect people's psychology. >> and given the disagreement between republicans and democrats for most part over whether this is a good idea, an effect on the campaign or not, in the election. >> well, you know, i think it's hard to bash the fed. romney said he wanted to get rid of bernanke. i think people basically have some, to the extent they understand what he does, i think they have some basic trust in him. if you saw inflation gallopping along then would you say what is this guy doing. but the inflationary pressures really hard to see compared it to the unemployment. >> he's gorge bush's fed chairman. he's not a crazy left wing guy. but mitt romney said he's not going reappoint him. >> not going reappointment but the question is to the extent that the public understands it, i don't think they are going to be moved by this pretty much one way or the other. >> well, we are moved by both of you. thank you both. >> thanks, judy. >> a

>> woodruff: and a reminder-- you can keep up with the newshour's political coverage on twitter. follow @newshour, and the hashtag "pbs election." >> brown: finally tonight, a different way of looking up close at campaigns and what influences voters. hari sreenivasan has our book conversation. >> the general has spent two years examining the fundamentals of elections from microtargeted polling to the on the ground tactics op rattives deploy to make sure people show up at the polls. his new book the victory lap, the secret science of winning campaigns takes readers in ctompaign war rooms for an inside look at the data of driving some of the political decisions. he joins us now, thanks being with us. >> thanks for having me. >> you describe almost a scientific revolution that is happening in campaigns and you say there are experiments happening now on who votes and why that are similar to drug trials, how is that? >> basically randomized control trials.

so instead of randomly assigning people into groups and giving them a different pharmaceutical and leading a control group or placebo. people are sending mail orion line ads or robo calls, randomly a signing them and going out and measuring the impact, looking at who voted to see if it affected turnout or pollili before and after to see whether it changed people's opinion. >> it used to be that polling was the science of campaigns and now there is so much more behavioral science and predex and analytics that is going into it. when did that happen? >> in the week of 2000 i think a lot changes. you have all sorts of new data coming from the commercial world that is making its way into politics. you have academics and political science, discovering field experiments, political science had never spent anywhere near as much time as some of the other social science, actually testing things in the field. people run these experiments and see what actually moves voters. you there are a lot of things we see in polls and focus group, don't really live up to the way that people experience politics in the real world.

>> so this combination of commercial data and political data, give me an example. >> well, for you, hari, you are a registered voter so right away i know on your voter registraraon record if you are affiliated with a party, which elections you voted in, if you voted in primaries, i know your date of birth, your age, your gender, in some states i know your race. i have all sorts of political information maybe from other groups or campaigns that contacted you in the past so i know someone from john kerry campaign knocked on your door and you told them you weren't interested in voting or you told them you care about the environment, all of that is in a data base somewhere. maybe you know, planned parenthood knocked on your door, the fra too and that information exists some where. then there is all this information that has been gathered by commercial data warehouses from magazine subscriptions to things you put on warranty forms. a lot first gathered by people who were ting credit ratings. they obviously want to foe as much about you as possible, what happened in the political world, people are doing statistical models

with the same goal so, instead of predicting whether you are likely to default on your loan or pay your bill on time or run you will $500 on your credit card, they are trying to predict how likely are you to november who are you to vote for, what issues do you care about. >> give me an example of how i am being targetsed but a voter might feel manipulated. >> yeah so,,fter they have done the statistical models and are moving you into one. few categories, are you somebody you want to persuade or turn out. the science on turnout has got answer lot better. we don't know a whole lot more about what makes you change your mind or how you change your mine than we did a decade ago. we know more about what can motivate to you cast a ballot. increasingly it informed by behavioral psychology. the most effective tool we've ever seen documented, an experiment in michigan in 2006 where some political scientists worked way pretty quirky male vendor, in lancing to send voters copies of their own voter history. so this is as in the last 8

elections you voted in the 2010 general election, you didn't vote in the school board election. and your neighbor vote histories and people on your block and whether they voted in certain elections. and it said there is an election coming . after the election we will send everybody an updated set it had an astronomical impact compared to any other tool for getting out the vote. it did, it is what psychologists call social pressure and people sort of have been working with this idea that voters are concerned with, or their identity around voting time. >> let's talk a little bit about this campaign now. there is so much talk of the huge amount of money that is being spent, a dollar per voter figures, especially in battleground states. how much of those dollars are spent on traditionana kind of negative campaign ads and how much of it is spent doing this kind of research that you are talking about. >> i country increasingly campaigns are recognize the value of doing turnout as opposed to just persuasion partially because the science has gotten better. a lot of the research isn't necessarily taking mace in campaigns. campaigns still are not

likely to spend a dollar now for someththg that will yield a less on in december. what they are doing is insights that are coming out of academia or coming out of sort of some of these research institutes that have popped up in politics are affecting everything that goes on on the ground. and so you know, when you get contacted the weekend before the election by somebody doing get out the vote for ot bama campaign, they are almost certainly going ask you what time dow plan to vote on election day. they are not going write down the answer but it's because they have learned through years of experiment that ising people what time they plan to vote, where they are going to come from beforehand what they will be doing that day makes them develop a plan which is a behavioral mechanism that actually maybes somebody more likely to follow through on an action after they thought through how they will do it. >> both of these campaigns seem to be spending a tremendous amount of money on going after either the off the grid or on demand voter, meaning the person who is not watching traditional tv. they might have cut the cord for cable, only watching

on-line ads. >> one of the big things that happened this cycle is campaigns are finally able to sort of merger or sync up your off line political identity and your on-line political behaviors. and so we, there have been lots of analytics since 20034 in the on-line world but they sort of existed in isolation there. so if you signed up on a web site than it is pretty good at being able to track how you moved around that web site. the only things people did on-line was sign up to volunteer or give money. you still vote in the real world, you vote in the precinct where you live, your registration is tethered to an address and we never knew whether a person was signed up on the list with the same person that was registered at a given address that is whanged through cookies on-line, campaigns are able to link a voter file record to somebody moving around the internet and it's given them the ability to sync up their interactions to view what they araroing when the volunteer calls you or knocks on your door, they are sending direct mail at your house. >> you also in the book get

into this cat and mouse game that essentially every campaign learns from its failures and moves ford and whether it is what karl rove did in 2000 or 23004, the democrats respond and the republicans respond again and again. >> learn from their failures or overreact from their losses is probably a little of both. but definitely 29004 bush re-election scared democrats like nothing before. partially for things that the republicans had really figured out and partially for mythology that it emerged around rove and some of the people's in bushes world for things that they had done. but i actually think, and i sort of tell the story of 2004 in the bock, i think the parties are actually far closer in terms of where they were in unlocking the underlying secret of microtargeting which is you can predict what an individual is going to do. one of the advantages bush had in '04 which obama has in 2008 is that when you ray presidential re-election you have several years to fill the system where people actually will follow through on things. and the bush campaign was far better implementing it

in their day-to-day operations than kerry ever was. >> the intook culd the vick row lab, the secret science of winning campaigns, thanks so much for your time. >> thanks, hari. >> woodruff: again, the major developments of the day: anti-american clashes erurupted around the muslim world for a fourth day with protests outside u.s. embassies in the middle east, africa, and asia. negotiators in chicago said they've got a framework for a contract to end a week-old teachers strike. and late today, a state judge in wisconsin struck down the law that ended collective bargaining rights for most public employees. but the office of republican governor scott walker said he expects the law to be upheld on appeal. we look online at the current state of diplomatic relations between the u.s. and egypt. kwame holman has more on that. >> holman: should the u.s. continue sending aid to egypt? we look at how much money goes

to support the egyptian military, and get your take on the aid question. on "art beat," jeff talks to the executive producer of "broadway or bust," pbs's special series on young actors trying to score their big breaks in the big apple. margaret warner talks with former supreme court justice david souter tonight in new hampshire. we'll carry a live stream of the event on our web site. and tonight's edition of "need to know" explores the american military's use of aerial drones against al qaeda members in pakistan. we have a link. all that and more is on our web site, newshour.pbs.org. judy. >> woodruff: and that's the newshour for tonight. on monday, we'll update the state of the presidential campaign with susan page and stuart rothenberg. i'm judy woodruff. >> brown: and i'm jeffrey brown. "washington week" can be seen later this evening on most pbs stations. we'll see you online, and again here monday evening. have a nice weekend. thank you and good night. >> major funding for the pbs newshour has cro

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